New Zealand Attracts Hollywood Films with Increased Subsidies

The New Zealand government has announced that it will raise subsidies of big-budget films from 15 to 20 percent of production expenditures, with an additional five percent for movies that will bring an economic benefit to the country. The move was made to boost the ailing domestic film industry, which was losing money and talent to countries that offered better incentives – such as England, Australia and Canada.

“It’s doing very poorly at the moment. I have a lot of friends who are having to leave the country. The choice for the government right now is whether they want a film industry or not,” said award-winning film-maker Andrew Adamson in August of this year.

With the new incentives in place, James Cameron revealed on Monday that he had made a deal with the Kiwi government for increased production subsidies to film the three sequels to the highest grossing film of all time, Avatar. The agreement includes commitments from 20th Century Fox for spending on production in New Zealand, crew quotas, and a film premiere in New Zealand for one of the three movies.

“The Avatar sequels will provide hundreds of jobs and thousands of hours of work directly in the screen sector as well as jobs right across the economy,” said Economic Development Minister Steven Joyce.

The subsidy for the series will account for up to 25 percent of the films’ $415 million budget. The BBC reported that at least $413 million would be spent in the country and that “hundreds of jobs” would be created.

However, it’s not just the financial incentives that lured the production crew of Avatar to New Zealand, according to director James Cameron, but the skilled production crews and high quality special effects that the country offers.

“I’ve worked with crews all over the world, quite a bit in the US and Canada, and you don’t have that same spark,” he said.

Some disagree with the argument that the subsidies the government gives to Hollywood production teams who create movies that gross millions at the box office have some sort of economic benefit for New Zealand. The leader of opposition party New Zealand First, Winston Peters, reportedly stated that the $67 million subsidy provided to The Hobbit, which earned $1 billion, should be paid back to New Zealand taxpayers. He also questioned the 3,000 jobs created by the trilogy and argued that they “were plucked out of thin air.”

“There is no doubt now that the deal with the movie industry was more about lining pockets than creating jobs,” he said.